I don’t have much to add to the thought-provoking social discussion surrounding the tragedy in Charleston, S.C.; both the shootings and the Confederate Flag debate. Missing from all the discussions however is that racism is NOT just a matter of Sociology, but also of politics and economics in a historical context. The fact is that the Confederate Flag is not just a symbol of racism, but also a symbol of over 500 years of failed social, political, and economic policy; and one that apparently people are proud of.
I suspect that we cannot have conversations about race without having a conversation about the historical economics and politics behind race. They are intertwined beyond mere correlation. Institutions of racism cannot exist without economic and political institutions. In the case of so many southern states, political and economic institutions (as Paul Krugman points out here) cannot exist without racist institutions. And as of lately, the field of Sociology hasn’t been up to the task of analyzing that. Dara Lind over at Vox points out that Bernie Sanders refuses to discuss the social aspects of racism because he believes that all social problems begin with economic inequality. He’s not alone. Academics for centuries have posed the same idea.
Marx (wrongly) believed that society had moved past slavery in his theory of Historical Materialism written in (1846), and subsequently published in the book “The German Ideology.” C. Wright Mills in the “Power Elite” posed that geopolitics were beholden to economic forces in the United States. Thorstein Veblen believed that non-productive labor (the “leisure class”) were responsible for flawed economic policy. In 2014, Picketty showed that economic forces lead to social problems. In 1920, John Maynard Keynes showed that economic forces as transmitted via politics would lead to World War II (and he was right).
Talking about slavery in the context of race is uncomfortable in all venues. There’s an academic paper from some historical economists from the University of Chicago and Northwestern University on the economics of slavery. This paper could not get published in any journal because it was too much of a hot potato in an arena where the free discourse of ideas has been hobbled for some time. I can’t find anything methodologically wrong with it. And it simply points out, using peer reviewed standards, that those that owned slaves in 1800’s America made out like bandits economically, exemplifying the exploitation of (slave) labor in the antebellum south.
From the paper, consider this: in 1804, the average price of a slave was $300 (in 2011 dollars). The average (labor) value added per slave was $75,000. The cost of maintaining that slave was about $6000. Return on investment in slavery? 232%
By 1860 that return on investment was only 140%. The price of a slave had only risen $450 (in 2011 dollars), but it became more expensive to maintain a slave with costs rising from $5000 (in 1804) to $25,000 (by 1860); far outpacing inflation or GDP growth. If we were to dig deeper, we could probably find a logarithmic diminishing marginal return to capital in antebellum slavery. Plantations just were not efficient.
So that’s a loss of slavery return on investment of 92% within 55 years. That has historically been, and continues to be the (near) textbook definition of economic failure. The last time there was a 92% loss on ROI, the government bailed out an investment bank and an insurance company.
The political failure comes in when the economic failure fought for its right to keep its most salient feature of economic failure – slavery. And only 1.6% of southerners actually owned slaves. So there may be something there about other institutions driving political institutions. Fighting for the right to fail, the south was wiped out as an economic and political institution. There’s still debate about what the civil war was really about; states rights, northern aggression, slavery & freedom, and all that. But the bottom line is that by 1867 the antebellum south was like a 3rd world country today; no economy to speak of, a barely functioning political body, no infrastructure, and no hope. Reconstruction was a total failure. And while the South would eventually rebuild infrastructure & government, they would never recover economically ever again. Today, the southern states are still in perpetual poverty.
Let’s assume for the moment that the south won the Civil War and slavery were allowed to continue. Based on a 92% loss of returns on slavery for every 55 years, then the south would be bankrupt right about…now.
So not only is the Confederate Flag a symbol of racism, slavery, and the “original sin” of a nation, but it is also a symbol of utter social, political and economic failure that permeates the southern U.S. 150 years after the Civil War.